[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 73 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                 H. R. 73

To require the Secretary of Health and Human Services and the Attorney 
 General to jointly carry out a demonstration program to reduce health 
    care costs through the sharing by medical facilities of certain 
   services and equipment, notwithstanding any antitrust law to the 
contrary, and to direct the Attorney General to carry out a certificate 
   of review process exempting eligible medical facilities from the 
                 application of certain antitrust laws.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 5, 1993

Mr. Hoagland introduced the following bill; which was referred jointly 
       to the Committees on Energy and Commerce and the Judiciary

                              May 11, 1993

                     Additional sponsor: Mr. Dooley

_______________________________________________________________________

                                 A BILL


 
To require the Secretary of Health and Human Services and the Attorney 
 General to jointly carry out a demonstration program to reduce health 
    care costs through the sharing by medical facilities of certain 
   services and equipment, notwithstanding any antitrust law to the 
contrary, and to direct the Attorney General to carry out a certificate 
   of review process exempting eligible medical facilities from the 
                 application of certain antitrust laws.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Health Services Cost Control Act''.

SEC. 2. PURPOSE.

    It is the purpose of this Act to reduce health care costs by 
encouraging cooperation between hospitals and other medical facilities 
in order to contain costs and achieve a more efficient and effective 
health care delivery system through the elimination of unnecessary 
duplication of expensive medical or high technology services or 
equipment while preserving services in geographical proximity to the 
communities traditionally served by the facilities.

SEC. 3. TECHNOLOGY AND SERVICES SHARING DEMONSTRATION PROGRAM.

    Part D of title VI of the Public Health Service Act (42 U.S.C. 291k 
et seq.) is amended by adding at the end thereof the following new 
section:

``SEC. 647. TECHNOLOGY AND SERVICES SHARING DEMONSTRATION PROGRAM.

    ``(a) Establishment.--
            ``(1) In general.--The Secretary and the Attorney General 
        (in this section jointly referred to as the `Administrators') 
        shall jointly carry out a demonstration program under which 
        twenty three-year grants are awarded for fiscal year 1994 to 
        eligible applicants to facilitate collaboration among two or 
        more licensed hospitals or other medical facilities with 
        respect to the provision of expensive, capital-intensive 
        medical technology or other highly resource-intensive services. 
        Such program shall be designed to demonstrate the extent to 
        which such agreements result in a reduction in costs to the 
        facilities and individuals involved, in an increase in access 
        to care for individuals, and in improvements in the quality of 
        care.
            ``(2) Service area.--The Administrators shall determine the 
        region to be served by a demonstration program under paragraph 
        (1). In carrying out this section, the Administrators shall 
        ensure that the operation of such a program preserves the 
        availability of health services in geographical proximity to 
        the communities traditionally served by the facilities 
        participating in the program.
    ``(b) Eligible Applicants.--
            ``(1) In general.--To be eligible to receive a grant under 
        subsection (a), a medical facility or facilities shall prepare 
        and submit to the Administrators an application at such time, 
        in such manner, and containing such information as the 
        Administrators may require, including--
                    ``(A) a statement that such entity desires to 
                negotiate and enter into a voluntary agreement under 
                which such entity is operating in one State or region 
                for the sharing of medical technology or services;
                    ``(B) a description of the nature and scope of the 
                activities contemplated under the cooperative 
                agreement;
                    ``(C) a description of the financial arrangement 
                between the entities that are parties to the agreement;
                    ``(D) a description of the geographical area 
                generally served by the entities;
                    ``(E) a description of anticipated benefits and 
                advantages to the providers and to individuals; and
                    ``(F) any other information determined appropriate 
                by the Administrators.
            ``(2) Development of evaluation guidelines.--Not later than 
        90 days after the date of enactment of this section, the 
        Administrators shall develop regulations, including criteria 
        and evaluation guidelines with respect to applications 
        submitted under paragraph (1).
            ``(3) Evaluations of applications.--The Administrators 
        shall evaluate applications submitted under paragraph (1). In 
        determining which applications to approve for purposes of 
        awarding grants under subsection (a), the Administrators shall 
        consider whether the agreement described in each such 
        application meets the criteria and guidelines developed under 
        paragraph (2) and is likely to result in--
                    ``(A) the enhancement of the quality of care;
                    ``(B) the preservation of services in geographical 
                proximity to the communities traditionally served by 
                the applicant;
                    ``(C) improvements in the cost-effectiveness of 
                high-technology services by the entities involved;
                    ``(D) improvements in the efficient utilization of 
                the entities' resources and capital equipment;
                    ``(E) the provision of services that would not 
                otherwise be available;
                    ``(F) the elimination of unnecessary duplication of 
                hospital resources;
                    ``(G) a reduction in costs to individuals; or
                    ``(H) no undue harm to the care provided 
                individuals seeking services.
    ``(c) Allocation of Grant Funds.--
            ``(1) In general.--Amounts provided under a grant awarded 
        under subsection (a) shall be used to facilitate collaboration 
        among entities. Such permissible uses may include 
        reimbursements for the expenses associated with specialized 
        personnel, administrative services, support services, 
        transportation, and instructional programs. Funds may not be 
        used to purchase expensive, capital-intensive medical 
        technology or other highly resource-intensive services not 
        previously owned or provided by the facility.
            ``(2) Grant award amount.--Entities applying for grants 
        under subsection (a) shall specify the desired grant award 
        amount. The Administrators shall determine the appropriate 
        amount in granting such awards.
            ``(3) Geographic and size diversity.--In awarding grants 
        under this section, the Administrators shall assure that, to 
        the extent reasonably practicable, there is a sufficiently 
        representative geographic and size distribution of grantees.
    ``(d) Medical Technology and Services.--
            ``(1) In general.--Agreements carried out under this 
        section shall provide for the sharing of medical technology or 
        eligible services among the entities which are parties to such 
        agreements.
            ``(2) Medical technology.--For purposes of this section, 
        the term `medical technology' includes the drugs, devices, 
        equipment and medical and surgical procedures utilized in 
        medical care, and the organizational and support systems within 
        which such care is provided, that--
                    ``(A) have high capital costs or extremely high 
                annual operating costs; and
                    ``(B) are technologies with respect to which there 
                is a reasonable expectation that shared ownership will 
                avoid a significant degree of the potential excess 
                capacity of such service in the community or region to 
                be served under such agreement.
            ``(3) Eligible services.--With respect to services that may 
        be shared under an agreement entered into under this section, 
        such services shall--
                    ``(A) either have high capital costs or extremely 
                high annual operating costs; and
                    ``(B) be services with respect to which there is a 
                reasonable expectation that shared ownership will avoid 
                a significant degree of the potential excess capacity 
                of such services in the community or region to be 
                served under such agreement.
        Such services may include mobile services.
    ``(e) Term.--The demonstration program established under this 
section shall continue for 3 calendar years.
    ``(f) Reports.--
            ``(1) In general.--Grantees shall submit annual reports to 
        the Administrators containing information on the demonstration 
        projects funded under this section, as required by the 
        Administrators.
            ``(2) To congress.--On the date that occurs 42 months after 
        the establishment of the demonstration program under this 
        section, the Administrators shall prepare and submit to the 
        appropriate committees of Congress, a report concerning results 
        of the demonstration and the potential for cooperative 
        agreements of the type entered into under this section to--
                    ``(A) contain health care costs;
                    ``(B) increase the access of individuals to medical 
                services; and
                    ``(C) improve the quality of health care.
        Such report shall also contain the recommendations of the 
        Administrators with respect to future programs to facilitate 
        cooperative agreements and recommendations for legislation.
    ``(g) Relation to Antitrust Laws.--
            ``(1) In general.--Notwithstanding any provision of the 
        antitrust laws, it shall not be considered a violation of the 
        antitrust laws for an entity that receives a grant under 
        subsection (a) to enter into and carry out activities under a 
        cooperative agreement in accordance with this section.
            ``(2) Definition.--For purposes of this subsection, the 
        term `antitrust laws' means--
                    ``(A) the Act entitled ``An Act to protect trade 
                and commerce against unlawful restraints and 
                monopolies'', approved July 2, 1890, commonly known as 
                the ``Sherman Act'' (26 Stat. 209; chapter 647; 15 
                U.S.C. 1 et seq.);
                    ``(B) the Federal Trade Commission Act, approved 
                September 26, 1914 (38 Stat. 717; chapter 311; 15 
                U.S.C. 41 et seq.);
                    ``(C) the Act entitled ``An Act to supplement 
                existing laws against unlawful restraints and 
                monopolies, and for other purposes'', approved October 
                15, 1914, commonly known as the ``Clayton Act'' (38 
                Stat. 730; chapter 323; 15 U.S.C. 12 et seq.; 18 U.S.C. 
                402, 660, 3285, 3691; 29 U.S.C. 52, 53); and
                    ``(D) any State antitrust laws that would prohibit 
                the activities described in paragraph (1).
    ``(h) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section, $2,500,000 for each of the 
fiscal years 1994 through 1996. Any appropriation pursuant to the 
preceding sentence shall be subject to section 601 of the Congressional 
Budget Act of 1974 (relating to discretionary spending limits).''.

SEC. 4. CERTIFICATE OF REVIEW PROCESS.

    (a) Issuance of Certificate of Review.--
            (1) In general.--The Attorney General may issue a 
        certificate of review with a three-year term to licensed 
        hospitals and other medical facilities that enter into 
        cooperative agreements with respect to the provision of 
        expensive, capital-intensive medical technology or other highly 
        resource-intensive services if such agreements--
                    (A) are designed to result in a reduction in 
                unnecessary duplication of services, in a reduction in 
                costs to individuals, in an increase in access to care 
                for individuals, or in improvements in the quality of 
                care;
                    (B) will not unreasonably enhance, stabilize, or 
                depress prices within the United States for the 
                equipment or services of the class under the agreement; 
                and
                    (C) will not constitute unfair methods of 
                competition against competitors engaged in providing 
                the services of the class under the agreement.
            (2) Deadline for response to application.--The Attorney 
        General shall respond to a request for a certificate of review 
        under paragraph (1) not later than 90 days after receiving the 
        request.
    (b) Protection Conferred by Certificate of Review.--
            (1) Protection from civil or criminal antitrust actions.--
        Except as provided in paragraph (2), no criminal or civil 
        action may be brought under the antitrust laws against a 
        hospital or other medical facility to which a certificate of 
        review under subsection (a) is issued which is based on conduct 
        which is specified in, and compliance with the terms of, such 
        certificate of review which certificate was in effect when the 
        conduct occurred.
            (2) Civil actions.--
                    (A) Any person who has been injured as a result of 
                conduct engaged in under a certificate of review under 
                subsection (a) may bring a civil action for injunctive 
                relief, actual damages, the loss of interest on actual 
                damages, and the cost of suit (including a reasonable 
                attorney's fee) for the failure to comply with the 
                standards of such subsection. Any action commenced 
                under this subsection shall proceed as if it were an 
                action commenced under section 4 or section 16 of the 
                Clayton Act, except that the standards of subsection 
                (a) and the remedies provided in this paragraph shall 
                be the exclusive standards and remedies applicable to 
                such action.
                    (B) Any action brought under subparagraph (A) shall 
                be filed within two years of the date the plaintiff has 
                notice of the failure to comply with the standards of 
                subsection (a) but in any event within 4 years after 
                the cause of action accrues.
                    (C) In any action brought under subparagraph (A), 
                there shall be a presumption that conduct which is 
                specified in and complies with a certificate of review 
                does comply with the standards of subsection (a).
                    (D) In any action brought under subparagraph (A), 
                if the court finds that the conduct does comply with 
                the standards of subsection (a), the court shall award 
                to the hospital or other medical facility against which 
                the claim is brought the cost of suit attributable to 
                defending against the claim (including a reasonable 
                attorney's fee).
                    (E) The Attorney General may file a suit pursuant 
                to section 15 of the Clayton Act (15 U.S.C. 25) to 
                enjoin conduct threatening clear and irreparable harm 
                to the national interest.

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